View Recent Blog Posts in this Area of Practice

• Federal Judge Sheds Light on Boundaries of Discovery Duties By Katie D. Bell In The Pension Committee of the University of Montreal Pension Plan, et al. v. Banc of America Securities LLC, et al., 685 F.Supp.2d 456 (S.D.N.Y. 2010), Judge Scheindlin—author of the renowned Zubulake decisions—further develops the boundaries of discovery duties in a lengthy opinion. Although the opinion does not require parties to meet a standard of perfection during discovery, the opinion serves as an important guide that offers concrete rules and potentially burdensome standards that attorneys should heed to avoid sanction. Writing systematically, Scheindlin initially frames the fundamental concepts underlying the nature and scope of a party’s duty to preserve, collect, review, and produce requested records during discovery: The first [critical issue] is plaintiffs’ level of culpability-that is, was their conduct of discovery acceptable or was it negligent, grossly negligent, or willful. The second is the interplay between the duty to ....
• The Rogue Co-Owner: Cutting and Selling Timber from a Co-owned Tract By Terry D. McCay and Benn Vincent Picture this: former wife sues her ex-husband for cutting and selling timber from a co-owned 120-acre timberland tract. The timberland tract was purchased during the couple’s marriage and was community property. As part of a divorce settlement, the ex-couple remained co-owners of the timberland. Thereafter, the ex-husband had the timber cut and sold – and checks for the timber sold were made payable to the then girlfriend (now wife) of the ex-husband. When the former wife found out, she sued the ex-husband, seeking treble damages (among other things), under Louisiana’s so-called “timber piracy” statute. As a co-owner, is the ex-husband liable to his former wife under Louisiana’s “timber piracy” statute? This was the issue presented to the Louisiana Supreme Court in the case, Sullivan v. Wallace, 2010-0388 (La. 11/30/10), 51 So.3d 702. The Court concluded that he was not, because the “timber ....
• Recent Fifth Circuit Decision Illustrates Importance of Including Demurrage Clause in Contract for Sale and Transport of Goods by Sea By Brittany L. Buckley Maritime attachment is a powerful procedure that allows an aggrieved party to garnish any of the defendant's property located within a particular federal judicial district.  Attachment is especially powerful because the garnished property can be used to ensure satisfaction of a claim, even if the property within the judicial district is not related to the claim that has been filed there.  This right can prove invaluable for securing payment of claims from a foreign defendant who cannot be easily traced down and sued.  This particular species of attachment is unique to admiralty law and is only available to satisfy "admiralty" or "maritime" claims, including contractual obligations that are separable from an non-maritime aspects of a contract. The Fifth Circuit’s recent decision in Alphamate Commodity GMBH v. CHS Europe SA, 627 F.3d 183 (5th Cir. 2010) narrowly defines maritime claims, thereby limiting the ....
• Insurer's Breach Not a Waiver By Todd A. Rossi Does an insurer waive its policy defenses when it breaches its duty to defend?  In Arceneaux v. Amstar Corp., 211 WL 2591701 (La. July, 2011), the insurer breached its duty to defend by issuing a denial of coverage and withdrawing from the insured’s defense.  The insurer’s action was based on the mistaken belief that its policies contained an exclusionary provision when, in fact, the exclusion was no longer effective.  According to the trial court, breaching the duty to defend resulted in a waiver of the coverage defenses.  The Louisiana Supreme Court concluded to the contrary, differentiating between a breach and a waiver.  Waiver is an intentional relinquishment of a known right or power, and occurs when an insurer with knowledge of the facts indicating non-coverage assumes or continues the defense without obtaining a non-waiver agreement to reserve its coverage defenses.  Under those circumstances, the insured is led to ....
• Piercing the Veil of an LLC - The Fourth Circuit Weighs In By Matthew C. Meiners The application of corporate veil piercing theories to limited liability companies is still in its early stages in Louisiana jurisprudence. In Hollowell v. Orleans Regional Hosp. LLC, the U.S. Court of Appeals for the Fifth Circuit became the first court applying Louisiana law to pierce the veil of a Louisiana limited liability company on an “alter ego basis,” adopting from corporate veil piercing jurisprudence a non-exhaustive list of factors, namely: 1) commingling of corporate and shareholder funds; 2) failure to follow statutory formalities for incorporating and transacting corporate affairs; 3) undercapitalization; 4) failure to provide separate bank accounts and bookkeeping records; and 5) failure to hold regular shareholder and director meetings. 217 F.3d 379, 385-386 (5th Cir. 7/18/00); citing Riggins v. Dixie Shoring Co., 590 So.2d 1164, 1168 (La. 1991). The court emphasized that the inquiry is in fact a “totality of the ....
• Beware: Arbitration By David K. Nelson In an arbitration, the parties agree to hire one or more neutral third parties to hear the dispute and issue a ruling.  The parties further agree to abide by that ruling.  If one party fails to do so, the ruling can be enforced by a court of law just as if an actual judgment had been entered.  Some suggest the process is less costly and more efficient than litigation; however, significant rights can be lost under the guise of so called legal efficiency.For example, what happens when the arbitrator gets it totally wrong, misunderstands the facts, and totally ignores or misapplies the law?  If the matter had been tried in a court of law, the losing party would have had an absolute right to appeal the ruling to an appellate court.  However, in an arbitration, there is no right to appeal.  Both the Federal Arbitration Act and Louisiana’s arbitration statutes set forth very narrow and fact specific grounds for vacating or modifying an ....
• Recent Developments in E-Discovery in Louisiana By Katie D. Bell Electronic Discovery, or “E-Discovery”, is not considered the “novel issue” it once was. However, E-Discovery still presents problems that litigants and courts struggle with. Below is a summary of recent Louisiana Federal Court opinions dealing with the issues surrounding E-Discovery. In Frees, Inc. v. McMillian, 2007 WL 184889 (W.D. La. Jan. 22, 2007), the Western District of Louisiana granted the plaintiff’s motion to compel. In an unfair competition and trade secret theft action, the plaintiff claimed that the defendant, a former employee, had stolen various data files. Plaintiff had unsuccessfully requested production of defendant’s laptop and desktop. The Court granted the motion to compel the defendant to produce these two items because they were the most likely places that the data files would be located. The Court did institute protective measures so as to prevent the disclosure of any irrelevant or personal information. ....
• Louisiana Supreme Court Interprets Unfair Trade Practices Act By James R. "Sonny" Chastain and Linda Perez Clark The Louisiana Supreme Court in Cheramie Services, Inc. v. Shell Deepwater Production, 2010 W.L. 1631977 (La. 2010) construed the Louisiana Unfair Trade Practices Act (“LUTPA”) to mean that persons other than business consumers and competitors may sue for alleged violations of the Act. Regardless of the context of the legislation, according to the Supreme Court, the term “any person” means exactly that – any person. In the action, Cheramie Services, Inc. (“Cheramie”) entered into a contract with Shell to provide personnel to its platforms. Shell placed two Cheramie employees, Kenneth Ward and Kevin Kays, on a platform. Shell paid Cheramie who paid the employees who were placed on these specific platforms. Ward and Kays alternated working fourteen day shifts so one of them was always on the platform. About six months thereafter, Shell stopped making payments to Cheramie and ....
• Supreme Court Clarifies Definition of a Corporation's "Principal Place of Business" By Bradley C. Myers   The United States Supreme Court recently resolved conflicts among the Circuit Courts about the citizenship of a corporation for determining diversity of citizenship jurisdiction (1). This will allow corporations to analyze with more predictable results whether to remove a case to federal court. In Hertz Corp. v. Friend, et al, No. 08-1107 (February 23, 2010) (a unanimous decision, which is unusual in and of itself), the Court decided that when determining a corporation’s citizenship for diversity of citizenship jurisdiction, the “principal place of business” of the corporation is “the place where the corporation’s high level officers direct, control, and coordinate the corporation’s activities”—something that courts have referred to as the “nerve center” of the corporation.Melinda Friend and John Nhieu sued Hertz Corporation in California state court alleging violations of California’s wage and ....
• Louisiana Warranty Statutes and Marine Products By Jay M. Jalenak, Jr. The Louisiana Civil Code provides an implied warranty for all things sold.  Specifically, a seller warrants the buyer against all redhibitory vices and defects.  A defect is “redhibitory” if it renders the item so useless or inconvenient that a buyer would not have purchased it or would have purchased it for a lesser price.   Louisiana does not have warranty statutes which are specific to marine products.  The following outline is an overview of Louisiana's warranty statutes in connection with marine products such as boats, personal watercraft, and outboard motors.A. Marine Product Warranty Statutes Louisiana does not have warranty statutes which are specific to marine products. B. General Warranty Statutes The Louisiana Civil Code provides an implied warranty, “redhibition”, for all things sold. Specifically, a seller warrants the buyer against all redhibitory vices and defects. A defect is ....
• Declaratory Judgment Action Still Requires Case or Controversy By Sonny Chastain The Fifth Circuit Court of Appeals recently addressed the standard for a declaratory judgment action in the context of trademark rights. In Vantage Trailers, Inc. v. Beall Corporation, 567 F.3d 745 (5th Cir. 2009), Vantage filed civil action seeking declaratory judgment finding that its designed for a new aluminum bottom dump trailer would not infringe on any valid trademark rights of Beall Corporation.  Beall manufacturers and sells an aluminum bottom dump trailer which is protected by a registered trademark.  In early 2006, Vantage began designing its own aluminum bottom dump trailer.  In July 2006, Beall’s vice president sent a letter to Vantage stating that if your company places any trailers into service that violate any of Beall’s trademarks we will pursue legal action to stop the infringement. In response to the letter, Vantage filed a civil action seeking a declaratory judgment that Beall’s trademark is invalid and that the ....
• The Limits on E-Discovery Nearly three years have passed since electronic discovery was formally introduced into the realm of discovery.  The scope of electronic discovery is broad- it includes discovery of “any information that can be stored electronically, including writings, drawings, graphs, charts, photographs, sound recordings, images, and other data or compilations—stored in any medium from which information can be obtained either directly, or if necessary, after translation by the responding party into a reasonably usable form.” However, the discovery of electronically stored information (“ESI”) is not without its limitations, thus lending comfort to those old dogs who do not want to learn new tricks. This article is aimed at fleshing out what limitations, if any, exist in the black hole of electronic discovery. Read the entire article from Around the Bar by Katie D. Bell and reprinted with permission from the Baton Rouge Bar Association.  ....
• What does the Transfer of Chinese Drywall Cases by the United States Judicial Panel on Multidistrict Litigation Mean? Throughout 2004–2007 a housing boom along with a series of hurricanes in the Gulf of Mexico combined to create a shortage of drywall in the United States.  Needing drywall to build the homes that were much in demand, suppliers turned abroad. Chinese manufacturers stepped in, providing cheap and readily available material.  This influx of Chinese drywall was concentrated in Florida, Louisiana, and Mississippi; the states most affected by Hurricanes Wilma, Katrina, and Rita.  Since 2006, it has been estimated by some sources that more than 550 million pounds of drywall have been imported from China.  There are reports that some 100,000 homes could possibly be affected nationwide. Reports of the damage caused by Chinese drywall to air conditioning units and appliances as well as health problems associated with it started to surface in 2006.  It has been reported that organic and chemical compounds in certain samples of drywall causes a ....
• Louisiana Legislature directs DHH, the Department of Insurance, and the Louisiana State Licensing Board for Contractors to Study the Effects of "defective Chinese Drywall" By G. Trippe Hawthorne The Louisiana Legislature has adopted House Concurrent Resolution No. 185, authored by Representative Tim Burns.  The resolution urges and requests that the Department of Health and Hospitals and the Deptartment of Insurance, in consultation with the Louisiana State Licensing Board for Contractors, investigate the health risks associated with living in homes that contain drywall imported from China, study the potential homeowners insurance coverage issues, including triggers, endorsements, and exclusions to policies that are related to drywall imported from China, and determine whether such material should be identified as a substandard, unsafe building material.  The resolution goes on to request a report of the findings and recommendations of this study to the legislature prior to the convening of the 2010 regular session. A copy of the enrolled version of the resolution can be seen here: Download file ....
• Quick Action by Registered Trademark Owners May Prevent Future Facebook Problems Beginning at 12:01 a.m. (Eastern Standard Time), on Saturday, June 13, 2009, members of the social networking website, Facebook, will be able to claim usernames to associate with their Facebook accounts and Facebook pages. This will allow Facebook pages to be accessed by using a url such as, http://www.facebook.com/unitedairlines, or something similar. Facebook is taking certain steps to prevent infringement of intellectual property through “name-squatting.” In connection with this, Facebook is allowing Federally registered trademark holders to prevent the registration of usernames that would infringe their intellectual property rights. There is a link to the form on Facebook’s Web site if you want to complete the form yourself. You will need the trademark registration number and the exact wording of the trademark as registered. For more information, or to protect your trademark, please contact Pamela Baxter at pamela.baxter@keanmiller.com (225.389.3761) or ....
• Franchise or Distributorship Termination Under Louisiana Law By Charles S. McCowan, Jr. In today's difficult economic climate, franchisors are often faced with a decision to consolidate, not renew or terminate unprofitable franchises.  Generally, franchise agreements have been entered into in better economic times and contain provisions that attempt to minimize adverse economic consequences to the franchisor arising from a non-renewal or termination.  The termination decision often leads to legal challenges involving the validity of such provisions.  These challenges include a determination of whether the termination is permitted by the contract, termination procedures, buy back issues and any damages that flow from the termination or non-renewal.Louisiana has adopted a number of provisions that relate to the expiration, non-renewal or termination of particular types of franchise agreements.  The general Louisiana rule is that unless the provisions of a business franchise provide otherwise, when the business to be ....
• Responsibility for Damage Caused by Falling Trees and For Removal of Fallen Trees By Michael O'Brien and Stephen Hanemann Hurricane Gustav recently wreaked havoc and felled trees throughout the heavily wooded areas of Southeast Louisiana.  As such, many property owners may be concerned who bears the responsibility for a fallen tree. Obviously, if a tree in a homeowner’s yard falls on his house, then that homeowner should contact his insurance agent for assistance in repairing the tree damage. The remainder of this article addresses the issue of tree-owner responsibility when a tree located on the property of one person (the “tree owner”) falls on the property of his neighbor (the “property owner”) damaging the house, car, fence or other property.A tree owner is not responsible for the damage caused by trees felled by the winds of Hurricane Gustav unless the neighboring property owner can establish that the tree fell because of its poor condition that the tree owner knew or should have known existed.  In the overwhelming ....
• Contractors' Faulty Workmanship Not Covered by Insurance Policy by Todd A. Rossi According to the Louisiana Supreme Court, a commercial general liability policy unambiguously excluded coverage for a contractor’s faulty workmanship. Supreme Services & Specialty Co. Inc. v. Sonny Greer, 958 So.2d 634 (La. 2007). The homeowner instituted legal action claiming that cracks in the slab were the result of faulty and defective design and construction, alleging causes of action based on breach of contract and breach of warranty. Relying on the "work product" exclusion in the policy, the court recognized that it reflected the insurance company’s intent to "avoid the possibility that coverage under a CGL policy will be used to repair and replace the insured’s defective products and faulty workmanship." The court recognized that a commercial general liability policy "is not written to guarantee the quality of the insured’s work or product." The court also found that the term "work" was defined ....
• FIRST CIRCUIT ADDRESSES ARBITRATION AGREEMENT by James R. Chastain, Jr. On March 23, 2007, the Louisiana First Circuit addressed the validity of an arbitration agreement in Lafleur v. Law Offices of Anthony G. Buzbee, 2007 WL 858859 (La. App. 1st Cir. 2007). The opinion has not been released in permanent law reports and is still subject to revision or withdrawal. The case arises out of a contract between Mr. Lafleur, a Louisiana resident, and his Texas attorneys, Jeffrey M. Stern and the firm of Stern, Miller, and Higdon. Mr. Lafleur retained the Stern defendants to pursue his maritime claim for personal injuries he sustained while traveling on a vessel in navigable waters off the coast of Louisiana. He executed an agreement with the Stern defendants which stated, "Any and all disputes, controversies, claims or demands arising out of or relating to this Agreement or any provisions hereof, the providing of services by the Stern defendants to Mr. Lafleur, or in any way relating to the relationship between the Stern defendants ....
• COMMERCIAL LEASES: EXCLUSIVE AND PROHIBITED USE CLAUSES by Brett N. Brinson Most commercial leases for multi-tenant properties contain clauses which regulate the tenants' use of the leased premises. Many tenants will require a landlord to grant the tenant the exclusive right to operate a certain business or sell a certain product to avoid competing with other tenants. These provisions are appropriately referred to as exclusive use clauses. For the landlord to satisfy its obligations under an exclusive use clause of one lease, the landlord is required to incorporate provisions in its other leases prohibiting the other tenants from using the leased premises for the restricted purpose. These clauses are commonly referred to as prohibited use clauses. A landlord may also include a prohibited use clause to prevent a tenant from using the leased premises in a manner which the landlord believes is a nuisance to the other tenants and reducing the overall value of the property. For example, a landlord may consider a ....